The aim of this research is to examine the factors that influenced toward income smoothing
practice among listed companies at Indonesia Stock Exchange. Income smoothing practice used
by the management to diminish the variability of a stream of reported income numbers related to
some perceived target stream by manipulating artificial (accounting) and real (transactional).The
factors being examined are debt to equity ratio, return on asset ratio, operating leverage ratio and
net profit margin. Eckel Index is used to determine the income smoothing practice. The object of
income smoothing in this research is the net profit of the company. The research is using 52
manufacture companies and 55 non manufacture companies listed in Indonesia Stock Exchange,
with a period 2008-2010. The hypothesis is tested using binary logistic regression.The result of
this research shows that some of the listed companies at Indonesia Stock Exchange are
committed to income smoothing practice. Binary logistic regression shows that debt to equity
ratio, return on assets ratio, operating leverage and net profit margin do not have significant
influence to income smoothing. But return on assets ratio of manufacture companies has
significant influence to income smoothing.